Indonesian firm accused of clearing rain forests

Wednesday, July 07, 2010

Press release from the issuing company

Jakarta, Indonesia - The environmental group Greenpeace has accused one of the world's largest pulp, paper and palm oil companies of aggressively clearing Indonesian rain forests and throwing into doubt a landmark billion-dollar deal that aims to fight climate change by curbing deforestation.

In a report released Monday, Greenpeace accused a subsidiary of the Indonesian family conglomerate Sinar Mas of secretly planning a massive expansion of pulp mills and cutting down essential forests, including habitats for endangered tigers.

An executive with the subsidiary, Asia Pulp and Paper, denied the charges.

The Greenpeace report says that an internal 2007 document shows that Asia Pulp drew up plans to significantly increase its pulp mill capacity to 17.5 million tons a year from 2.6 million tons.

The report also said that Asia Pulp had sought more than a million hectares in new concessions to meet this demand. In the Sumatran provinces of Riau and Jambi alone, the company sought 900,000 hectares, or 2.2 million acres, more than half of which was granted, Greenpeace says.

"What is actually happening in the field is they keep expanding because their timber concessions are not enough to supply their mills," said Bustar Maitar, Greenpeace's lead forest campaigner in Indonesia.

Asia Pulp's sustainability chief, Aida Greenbury, denied that the company had confidentially made any such expansion plans.

"To support production of 15 million tons of pulp a year is just impossible," Mrs. Greenbury said, because the company would not be able to harvest enough wood to feed the mills. "I don't know how they came up with 15 million tons."

She added, "It's impossible to plan expansion of pulp mills secretly because we need to get approval from the local government, the central government, everything else."

Greenpeace also charges that much of the land set aside and cleared overlaps with endangered-species habitats.

Mrs. Greenbury said that Asia Pulp did not use wood from forests it deemed to be of "high conservation value," which included deep peat and major endangered-species habitats. The company takes around 85 percent of its wood from plantations, she said, with the rest coming from degraded land or lower-value forests.

Greenpeace also charges that Asia Pulp has cleared peatlands more than three meters, or about 10 feet, in depth. In Indonesia, the clearing of such deep peatland is illegal because the land, which is made up of semidecomposed vegetation, releases huge amounts of greenhouse gases when burned or drained.

Hadi Daryanto, the Forestry Ministry's director general of forestry management, said he could not comment on the report because he had not yet seen a copy of it. He added that he had heard no reports of Asia Pulp clearing peatland more than three meters deep.

The Greenpeace report also criticizes several multinational companies, including Wal-Mart, Hewlett Packard, Carrefour and KFC, for buying from Sinar Mas and urges them to suspend dealings with the company.

The accusations of wrongdoing are particularly sensitive in Indonesia because President Susilo Bambang Yudhoyono has staked much of his global prestige on acting against climate change. Large-scale deforestation has made the country the world's third-largest emitter of climate-change-causing gases, behind China and the United States, according to some estimates.The country signed a $1 billion deal with Norway in May that imposes a two-year moratorium on new permits to clear virgin forest and peatland.

The deal is part of an approach to reduce emissions from deforestation and forest degradation, which is widely seen as one of the few areas of progress that came out of the collapsed climate change talks in Copenhagen last year.

But Greenpeace's accusations - and Sinar Mas's denials - hint at what critics say are major hurdles in the plan. Bureaucratic dysfunction, corruption and Indonesia's sheer size create confusion over what is happening in the field. At the same time, environmentalists, companies and governments frequently disagree on what constitutes environmentally sensitive land and what does not.

"This is a big question mark for the government of what forest protection will look like," Mr. Maitar of Greenpeace said. "If the big companies like A.P.P. or Sinar Mas as a group are still doing business as usual, still doing forest clearing, so what's the meaning of the moratorium?"